Rodrigo de Rato, the former head of the International Monetary Fund, has joined Lazard, the investment bank.

Mr Rato, who was also the Spanish Economics Minister for eight years, will join the M&A specialist in February as senior managing director of investment banking.

The high-profile signing follows Lazard's appointment of veteran Ken Costa as co-head of its UK business in September.

Mr Costa had been at UBS for 30 years before joining Lazard to lead its UK investment banking business alongside William Rucker.

Mr Rato's decision to leave the IMF in June, after only three years in the job, took onlookers by surprise. He said he had taken the decision "for personal reasons ... particularly with regard to the education of my children".

Lazard said Mr Rato would be based in Madrid and London. He will advise public and private clients on economic issues.

One other employee at Lazard already holds the senior managing director title – Vernon Jordan, a lawyer who was renowned as a leading light in the US civil rights movement.

Mr Rato, who holds a PhD in economics, can look forward to a hefty wage rise in his new role. Dominique Strauss-Kahn, the incoming managing director of the IMF, will earn nearly $500,000 a year. That sum comes net of income tax, but is eclipsed by the earnings of Lazard’s top executives.

Lazard, which has about 2,200 staff, spent $323 million on pay in the quarter to September alone.

In October, Lazard said that its third-quarter profit more than doubled, to $84 million, on record fees from completed transactions and continued growth in its asset management arm.

According to Dealogic, the market researcher, the bank was an adviser to $105 billion of deals that closed in the quarter.

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